Anyone with a good credit rating has no trouble finding a loan; in fact, lenders will usually fight between themselves to offer you the lowest APR to get your custom. However, if you have a poor credit rating it is different and many times the lender slams the door in your face turning you away or offers a loan with extremely high APR and fees. This may lead to the question of are loans for people with bad credit instant decision no fees possible to find?
While there are no specific loans on the market with the name of bad credit loans, there are types of loans that may be more suitable for those with a bad credit rating which come with a good approval rate. So let us look at the types of loans that may be easier to find approval for, they include:
- Guaranteed loans;
- Payday loans;
- Short-term loans.
All of the above loans may be easier to find approval for if you have a less than perfect credit score. This is not to say that all of the above loans are suitable for you. To be suitable a loan has to:
- Be affordable
- It has to provide you with the money you need
- Repayments can be made in the timeframe you specified
- It has to pay out in a timely manner
Loans for People with Bad Credit Instant Decision No Fees for Different Purposes
As mentioned above there are differences to the loans and there are some similarities, with one being all the loans come with an instant decision.
All loans also come with an eligibility check and so you have to make sure before applying that you:
- Have a regular income coming into the household (some benefits are classed as a regular income);
- You are at least 18 years old;
- You live in the United Kingdom;
- You hold a bank account in your name;
- You have a debit card in your name;
- A direct debit can be set up on your bank account.
Here we are going to talk about the different loans so you can work out which loan might be the most suitable for your needs.
All of the loans may be applied for if you have a less than perfect credit rating and all are generally easier to find approval for than a personal loan.
The Pros and Cons of a Guaranteed Loan
If you want to borrow a larger sum of money, say in the region of £5,000 and you have a bad credit rating you might be considering a guaranteed loan.
There are pros and cons to this type of loan, which need to be considered very carefully before rushing into the loan.
The guaranteed loan may be the easiest of loan to be approved for with a poor credit rating and this is one of the pros to the loan. It is an alternative to a personal loan, which is generally more difficult to find approval for with a poor credit rating, again another pro.
Now let us look at the downsides of applying for a guarantor loan. The biggest downside is that to apply for a guarantor loan you do need someone who is willing to take over the repayments of the loan in the event that you cannot continue to meet them.
This is a big ask of someone and that someone has to be someone close to you, either a family member (but not a spouse or partner) or a good friend. Essentially, you are asking them to put their good name and credit rating on the line.
Both you and the guarantor sign up for the loan, giving your details, including bank account details.
The Pros and Cons of Payday Loans
One of the pros of payday loans is that they are relatively easy to be approved for even with a poor credit rating. People who do not need to borrow a large sum of money favour the loans and they can be a great way of borrowing money to get out of unexpected financial trouble in the short term.
For instance, you might want to apply for a payday loan if you:
- Have an unexpected bill come in and you don’t have the money to cover it until you get paid;
- Your vehicle or a household appliance that you cannot manage without breaks down and you need money as soon as possible to pay for repairs;
- You have overspent on your bank account and are now in the red in an unauthorised overdraft and need funds to get back in the green or face large daily fees.
These are just three examples where it could pay to borrow a small amount of money and pay back the loan the next time you are paid.
One of the pros of the payday loan is that it is quick to apply for and if approved you could have money in the bank on the same day as applying.
Another pro of the payday loan is that the loan is not taken out over the long term so you are not tied down to long repayments. A loan of this nature is usually taken out over one to three months (paydays), with the repayments made on the dates you are paid and taken from your bank account.
Interest is added onto the loan on a daily basis so the less time you take to repay the loan, the lower the total cost of the loan.
One of the main downsides of the payday loan is that it may be an expensive way of borrowing if you find you cannot repay the loan as agreed. If you cannot repay it or have to roll it over, more interest and fees will be added on. On a positive note, the FCA limits the number of fees and times the loan is rolled over, so you will never pay more than twice the amount borrowed.
The Pros and Cons of Short-term Loans
Short-term loans for people with bad credit instant decision no fees are another way of borrowing over a relatively short amount of time so you do not have a loan hanging over your head for many years.
One of the main pros of a short-term loan is that you might be eligible to borrow up to £1,000 and spread the cost of the loan for up to 12 months. Spreading the loan out for up to 12 months can make the repayments of the loan more affordable.
However, the downside is that you are going to pay more in total for borrowing the longer you spread the loan over.
Another potential downside is the fact that with a poor or bad credit rating you are not going to be offered the cheapest rates of interest. On saying this, we do work alongside a wide range of lenders who do offer some of the most competitive rates based on your circumstances.
Benefits to Looking For Your Loan with Us
There are many benefits to looking for a loan with our help and these include:
- We are able to search with a wide number of lenders for your loan;
- Lenders will take affordability into account not just your credit rating;
- We work with lenders offering some of the most affordable rates on loans;
- You get an instant decision after giving us a few details;
- Lenders we work alongside offer numerous loan options;
- It takes just a few minutes to apply for a loan with our help;
- Lenders even consider poor credit ratings.
Why Are Fees Included in Some Loans?
Fees are included in some loans and often you have to check the small print to find out if a fee is included in a specific loan.
Some lenders will include early repayment fees in loans. An early repayment fee is a sum of money that you would have to pay if you found you could repay a loan earlier than the agreed date. For instance, you might take a short-term loan out over 12 months but then have a windfall and find you could pay off the loan 6 months down the road. If there is no early repayment fee, you could save on the interest. However, if you had to pay a fee it might outweigh any savings you might make on interest.
There are many choices of loans for people with bad credit instant decision no fees and we can help to match you up with a lender. The large panel of lenders we work alongside offer numerous loan options, payday loans, short-term loans and guarantor loans. All loans come with some of the best rates of interest and lenders will consider all circumstances.